Business and the environment
Businesses affect the local environment - both natural and social. Ethical businesses try to keep the impact of their operations on the environment to a minimum.
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Social costs and the environment
Business activity has an impact on the natural environment:
- resources such as timber, oil and metals are used to manufacture goods
- manufacturing can have unintended spillover effects on others in the form of noise and pollution
- land is lost to future generations when new houses or roads are built on greenfield sites
The unintended negative effects of business activity on people and places are called social costs and include:
- noise
- pollution
- visual blight
- congestion
Ethical businesses are careful to minimise the impact of their behaviour on the environment.
Government laws are used to protect the environment. For example, firms must apply for planning permission before building factories or offices on greenfield sites. Grants are available to encourage firms to locate on brownfield sites, run down areas in need of regeneration.